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Strong property market conditions across key capital city areas during 2013, have been the catalyst to provide a knock-on effect to some of Australia’s regional property markets with an increase in property values across several regions during 2013.
Only 16 council areas recorded a fall in median house values throughout 2013.
News of value growth across most markets over the year will be welcomed by the regional markets where in some cases they’ve been doing it tough - these results suggest that it is not just the capital city housing markets that are benefitting from the low mortgage rate environment, so too are regional areas.
<img src="/images/stories/2014/02/28/kusher-feb-28-one.gif" alt="kusher-feb-28-one" height="466" width="470">
As shown in the adjacent charts, topping the list of best performing regional areas with a 35% increase in values is the agriculturally-rich Riverina council area of <a href="/news">Carrathool</a>. Across each state, Western Australia and New South Wales each have 10 of the 25 regions where the greatest value growth was recorded followed by four regions in Victoria and one in South Australia.
In New South Wales, Victoria and South Australia, the regions to record the greatest increases in house values could be best described as ‘small regional markets’ which are generally located in the non-coastal areas of the state.
For Western Australia, the results are somewhat different where a number lifestyle markets around well-known coastal areas that have previously underperformed for many years, are now showing an increase in overall performance. These include: Augusta-Margaret River (19.9%), Capel (16.1%), Denmark (15.9%), Busselton (15.8%) and Murray (13.9%).
Areas to record the greatest falls in values have been the once fast-growing, resource-rich mining area of Isaac in Queensland where the median house value dropped by -12.4% over 2013. Across the states, Queensland, New South Wales and Western Australia each have the greatest number of regions listed (6) followed by: South Australia (4) and Tasmania (3).
Many of the council areas listed are linked to the mining and resources sector where investment peaked during 2013. As the results show, we are now seeing the impact of a lower demand for workers which is in a number of areas resulting in falling house values.
Areas that recorded the strongest increase in values and largest falls are noticeably devoid of the larger regional areas, except for Gladstone. Focussing on the 30 largest regional markets of the country ranked by population, each of these regions, again excluding Gladstone, recorded an increase in median house values throughout 2013.
Again, this re-iterates a climb in house values right across the country and not just within capital city markets.
<img src="/images/stories/2014/02/28/kusher-feb-28-two.gif" alt="kusher-feb-28-two" height="283" width="470">
As 2014 progresses, I would anticipate more of the same where resource areas will lag and other regional markets will gradually record further value rises.
Overall the challenge in the mix will be the rising levels of unemployment which can be more detrimental to less diversified regional economies than to capital city markets. On a positive note, with mortgage rates tipped to remain low and talk that the Australian dollar will continue to fall, the attractiveness of housing, particularly in some of the larger regional markets, is likely to continue to show further growth over 2014.
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/" rel="nofollow" target="_blank">RP Data</a>.
                     
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Regional markets are on the move!

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Almost two years has passed since the property market kicked in again and commenced another cycle of growth. Looking back at how the market performed over this period, a larger proportion of home sales crept into the higher price brackets.
2013 ended as a strong year for the property market where a healthy increase in house and unit sales coupled with a rise in home values of 9.8% across the combined capital cities was recorded. We saw median selling prices of capital city homes increased by a greater 10.2% over the year, indicating a shift to more expensive properties transacting throughout the year.
<img alt="rp-data-feb-13-one" height="238" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-one.gif">
An analysis of Australia’s combined capital cities revealed that there is quite a difference in pricing between houses and units where only 27.1% of capital city houses sold for less than $400,000 in 2013 compared to 39.4% of all units.
<img alt="rp-data-feb-13-two" height="244" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-two.gif">
For the same period, unit sales between $200,000 and $400,000 accounted for the greatest proportion of sales in 2013 at 35.7% while sales ranging from $400,000 to $600,000 accounted for the greatest proportion of house sales at 34.2%. Across the combined capital cities, 12.4% of house sales and 4.6% of unit sales were at or above $1 million.
At a combined capital city level, 27.1% of house sales were at prices below $400,000 compared to 63.8% across the regional markets. Similarly, 74.8% of all regional unit sales were below $400,000 in 2013 compared to 39.4%.
The proportion of home sales with a million dollar price tag or higher was lower in regional markets with just 1.7% of all regional house sales and 2.3% of regional unit sales at a price in excess of $1 million.
<img alt="rp-data-feb-13-three" height="338" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-three.gif">
For state-based house sales, the proportion of homes sold below $200,000 and between $200,000 and $400,000 is greater in regions outside of the capital cities or ‘rest of state’ as it is often referred to.  This highlights the fact that home prices are typically lower in regional markets than those in capital city areas.
<img alt="rp-data-feb-13-four" height="338" width="470" src="/images/stories/2014/02/13/rp-data-feb-13-four.gif">
The results for regional unit markets are similar to those for regional houses. The proportion of unit sales below $200,000 in regional areas is much greater than the proportion within the corresponding capital city.
Interestingly, in Australia’s two most affordable capital cities, Adelaide and Hobart, the proportion of unit sales between $200,000 and $400,000 is greater within the capital cities than within the regional market which is likely due to the fact that unit markets outside of these capitals have little depth of stock.
Relative to rest of state markets, the data highlights that the selling prices of homes in capital cities is significantly higher. With around 66% of Australian’s living within a capital city it is clear that competition for housing, particularly well located housing, is driving up selling prices - the current low mortgage rates are only intensifying this competition.
Across each city there are still homes selling at prices below $400,000 however, these homes are becoming rare and are usually located on the outskirts of the city in areas that are poorly supported by essential infrastructure.
Perhaps businesses and governments should be looking at ways to create jobs in regional markets as a way of making housing more affordable. At the moment, there seems to be lack of enthusiasm at all levels of government to provide a sustainable fix to housing affordability in our capital cities. As a result we would expect that the proportion of homes selling below $400,000 will continue to decline over the coming years.
Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>. 
    
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Fewer homes selling across affordable price points and disparity will only grow

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A combination of buoyant market conditions and low interest rates is largely responsible for driving up property values over the past 12 months. 275 suburbs now have a median house value of more than $1 million. For units, the news isn’t that exciting; just eight suburbs share a median unit value of more than $1 million.
Topping the list for houses is Sydney’s Point Piper with houses recording a whopping median value now sitting at $5,817,581. Other Sydney suburbs making it to the top ten included: Woolwich, Darling Point, Centennial Park, Cremorne Point, Bellevue Hill. Peppermint Grove in WA, and Victoria-based suburbs, Deepdene and Toorak, also made the cut to the top 10.
<img src="/images/stories/2014/02/21/kusher-feb-21-one.gif" width="470" height="239" alt="kusher-feb-21-one">
Of the 212 suburbs with a median price of at least $1 million, 56% were in Sydney in New South Wales and 20% of suburbs were located in Victoria. These were then followed by Western Australia (12%), Queensland (6%), South Australia (3%), Australian Capital Territory (2%) and Northern Territory (0.5%).
Across council areas, Ku-ring-gai in Sydney has recorded the greatest number of suburbs in the million dollar club with 15 suburbs having a median price of $1 million or greater.  Other council areas with a substantial number of $1 million plus suburbs include: North Sydney (12), Woollahra (10) and Brisbane, Canada Bay and Boroondarra (each nine).
<img src="/images/stories/2014/02/21/kusher-feb-21-two.gif" width="470" height="241" alt="kusher-feb-21-two">
Although with just eight in the list of units where values reached over the one million dollar mark, it was Sydney that again scored top results in the list of best performers by exceeding the million dollar value mark. Included in the list of Sydney suburbs are Dawes Point, Point Piper, Darling Point, The Rocks, Millers Point and Huntleys Cove and Milsons Point. Brisbane riverside suburb Tennyson was the only other suburb outside of Sydney to make the top.
Just 12.4% of all capital city houses and 1.7% of regional houses sold in 2013, transacted for more than $1 million. For units it was 4.6% of capital city sales and 2.3% of regional unit sales which had a $1 million price tag.
Despite such significant media reporting about homes over $1 million, these actually account a very small portion of the overall sales within the market.
At a national level, 275 suburbs (or 6.1% of suburbs with a reported median value), have a median house value which is greater than or equal to $1 million. Nationally, only eight suburbs have a median unit value which is greater than $1 million, representing 0.4% of all suburbs.
In 2005, just 78 suburbs across the country had a price tag of $1 million or more.  In just five years, the number of $1 million plus suburbs has increased by 172%.  Victoria has recorded the greatest increase in suburbs with a $1 million price tag over the five years, increasing by 950% during the period.
<img src="/images/stories/2014/02/21/kusher-feb-21-three.gif" width="470" height="433" alt="kusher-feb-21-three">
The figures vary somewhat when looking exclusively at the capital city markets. It’s important to remember that home values tend to be much higher in the capital cities and this is where the bulk of the national population resides.
For houses, there are 271 capital city suburbs or 12.0% of all suburbs that have a median value of more than $1 million. For units, 0.6% or 8 capital city suburbs have a median value of more than $1 million. Across individual cities the current results are also quite different.
For houses, almost one in every four Sydney suburbs has a median house value of more than $1 million, in Perth the figure is 12% of suburbs and in Melbourne around one in 10 suburbs has a median value of more than $1 million. Very few suburbs have a median unit value of more than $1 million, only eight suburbs nationally. Seven of these eight suburbs are in Sydney with the remaining one in Brisbane.
Five years ago, around 5% of all suburbs nationally had a median house value which was more than $1 million and for units, 0.4% of all suburbs held a median value which was more than $1 million. By way or proportion, the five year change has been minimal with a median unit value of more than $1 million but a full one percentage point increase in the proportion of suburbs where houses have a median value of more than $1 million.
Suburbs where the median value is in excess of $1 million are quite small. However, as home values increased over the past five years so too has the number of suburbs.
With low mortgage rates and relatively high levels of buyer demand we would expect the proportion of suburbs with a median value of more than $1 million to trend higher throughout 2014. It is important to note that outside of Sydney, Melbourne and Perth suburbs with a median value of more than $1 million are a rarity.
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/" rel="nofollow" target="_blank">RP Data</a>.
 
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Where are Australia's million dollar suburbs?

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The Australian Bureau of Statistics (ABS) released housing finance data for December 2013 yesterday.  The data provides a good summary of the mortgage lending environment throughout 2013.  It shows that 2013 was clearly a year where there was a strong rebound in demand for mortgages.
<img class="aligncenter size-full wp-image-2871" alt="Chart 1" src="https://blog.rpdata.com/wp-content/uploads/2014/02/Chart-1.jpg" width="470" height="173" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
The total number of owner occupier housing finance commitments in December 2013 was 14.1% higher than in December 2012.  This figure is split into refinances of established dwellings and non-refinances or new loans.  The number of refinance commitments is 12.5% higher over the year and the number of new loan commitments is 14.8% higher. 
The data shows that demand for mortgages has increased measurably throughout 2013.  This is also reflected in home values data, the RP Data-Rismark Home Value Index showed that capital city home values rose by 9.8% in 2013.
<img class="aligncenter size-full wp-image-2872" alt="Chart 2" src="https://blog.rpdata.com/wp-content/uploads/2014/02/Chart-2.jpg" width="470" height="172" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
The number of owner occupier finance commitments for the construction of new dwellings was 14.5% higher over the year, commitments for the purchase of new dwellings were 13.2% higher and non-refinanced commitments for the purchase of established dwellings were 15.1% higher over the year.  It is important to note that non-refinanced purchases of established dwellings accounted for 75.8% of all owner occupier new loan commitments in December 2013.
Over the 12 months of 2013 there were 598,364 total owner occupier housing finance commitment, up 9.5% from a year ago.  Refinance commitments accounted for 32.4% of all housing finance commitments in 2013 and the remaining 67.5% was for new loan commitments.
<img class="aligncenter size-full wp-image-2873" alt="Chart 3" src="https://blog.rpdata.com/wp-content/uploads/2014/02/Chart-3.jpg" width="470" height="171" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
In December 2013, the total value of housing finance commitments (the amount borrowed) was $27 billion.  From a banking perspective, the money lent is much more important than the number of loans and the total value of finance commitments was 27.0% higher over the year.  
Looking at the value of commitments, commitments to owner occupiers for refinances were 20.4% higher year on year, owner occupier new loan (ex-refi) commitments were 19.0% higher while investment loan commitments increased by 40.7%.  The total value of housing finance commitments, excluding refinanced loans increased by 28.5% year on year.
<img class="aligncenter size-full wp-image-2874" alt="Chart 4" src="https://blog.rpdata.com/wp-content/uploads/2014/02/Chart-4.jpg" width="470" height="170" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Looking at the proportion of housing finance commitments provides further insight into how much is being lent to different cohorts of the market. 
As a whole, 60.2% of lending over the month was to owner occupiers made up of 43.4% for new loan commitments and 16.8% for refinances.  The rest (39.8%) was lending for investment purposes.  The 43.4% of lending to owner occupiers for new loans was the lowest proportion since January 2004.  The 16.8% of lending for refinances by owner occupiers was the lowest proportion for that segment since September 2010.  The 39.8% of lending for investment purposes was the greatest since October 2003 (41.2%).  The 41.2% of total lending for investment in October 2013 was also the highest proportion of investment lending on record.
In my opinion the level of investment lending is a concern from the market, given it is currently at near record levels.  Obviously with mortgage rates low and returns on relatively risk-free asset classes so low, investors are moving into other, slightly more risky, asset classes such as residential property.  This is what the RBA was hoping for – however, the high level of lending to investors is not without potential risks in the future. 
The move to residential property investment seems to be purely a move chasing capital growth.  In strong investment driven markets such as Sydney and Melbourne home values increased by 14.5% and 8.5% respectively in 2013.  Gross rental returns on residential property in these cities is extremely low at 4.0% and 3.5% respectively at the end of last year. 
If these investors are not necessarily committed to the housing market long-term, then we could potentially see an influx of investment-grade properties come to the market in the future as these investors look to exit the housing market and place their investment dollars elsewhere.
<img class="aligncenter size-full wp-image-2875" alt="Chart 5" src="https://blog.rpdata.com/wp-content/uploads/2014/02/Chart-5.jpg" width="470" height="171" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Despite the fact that we have near record low mortgage rates and home values had been falling through 2011 and the early part of 2012, the level of activity by first home buyers has been extremely low. 
In December 2013, the number of first home buyer finance commitments was actually 1.9% higher than the previous December (note these figures are not seasonally adjusted).  Throughout 2013 there were 82,599 first home buyer housing finance commitments indicating that they accounted for just 13.8% of all owner occupier finance commitments over the year.  The number of first home buyer finance commitments in 2013 was a record low for a calendar year period.
Overall the data highlights that 2013 was a strong year for mortgage lenders with escalating demand for mortgages.  The increase in demand has largely been driven by subsequent purchasers (upgraders or downgraders) and investors. 
The rising level of demand for mortgages has subsequently resulted in an increase in property sales and fuelled the 9.8% annual increase in capital city home values.  As noted the heightened level of activity by investors in the market is potentially a cause for concern and no doubt one that the RBA and APRA will be keeping a close eye on. 
Keep in mind that in many instances investors are using interest-only loans and these are obviously attractive when interest rates are at record low levels, but potentially not as attractive when/if interest rates are normalised.
With mortgage rates still at low levels and the market expectation that there will be no increase in the cash rate until 2015, it is difficult to see how there won’t be a further lift in housing finance commitments throughout 2014.  It will be interesting to see if we see a further lift in investment activity in the market and whether or not we see a rebound in first home buyer volumes throughout the year.
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/" rel="nofollow" target="_blank">RP Data</a>.
 
 
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Near record level of investment lending a concern for the market

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RP Data has been tracking the average number of days properties take to sell and the average vendor discount since the beginning of 2005.  Both measures have recorded a significant improvement throughout 2013 and the average number of days on the market is currently at a historically low level.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="171" width="470" src="https://blog.rpdata.com/wp-content/uploads/2014/02/VEE.jpg" alt="VEE" class="aligncenter size-full wp-image-2859">
Average vendor discount excludes properties sold at auction and those which have sold above their list price and measures the difference between the first advertised price and the ultimate selling price of a home.  The figure is then expressed as a percentage.  As at December 2013, the average discount for a capital city house was -5.7% and for a unit it was -5.5%.  At the same time in 2012, discounting levels were recorded at a much higher -6.9% for houses and -6.3% for units.  The current levels of vendor discounting are the lowest they have been since early 2010 for houses and mid to late 2010 for units.
An analysis of sales across the combined capital cities found that over the final quarter of 2013, 29.5% of all houses and 37.5% of all units sold transacted at a price which was at or higher than the original list price.  These figures were greatly improved from the 25.3% for houses and 30.8% for units at the end of the September 2013 quarter.  Although a relatively high proportion of properties are selling above the list price, the majority of homes continue to experience price negotiation and ultimately sell at a reduction from their original list price.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="171" width="470" src="https://blog.rpdata.com/wp-content/uploads/2014/02/TOM.jpg" alt="TOM" class="aligncenter size-full wp-image-2860">
The average time (days) on market figure excludes properties sold at auction and is measured by looking at the difference between the first advertised date of the property and the contract date once sold.  Based on a data series from the beginning of 2005, the average days on market figures for the combined capital cities are at historic lows of 38 days for houses and 35 days for units.  At the same time in 2012 the average days on market for capital city houses was recorded at 56 days and for units it was 53 days.
With homes seeing lower levels of reductions to the original list price it is no wonder that we are seeing an improvement in the average number of days on market.  Lower discounting levels mean that buyers and sellers are generally able to come to an agreement on price quicker.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="174" width="470" src="https://blog.rpdata.com/wp-content/uploads/2014/02/VEE-by-TOM.jpg" alt="VEE by TOM" class="aligncenter size-full wp-image-2861">
Looking at the level of discounting taking place in the market across the average time on market we see that well priced new stock is selling quickly at a very low discount level.  Across house and unit sales, homes that sold in less than 30 days had an average vendor discounting level of -3.3% in December 2013. 
At the same time, those homes that sold between 30 and 60 days had an average discount of -4.7%, -4.9% was the average discount for homes selling between 60 and 90 days, homes sold between 90 and 120 days on the market had an average vendor discount of -7.2% and homes which sold after more than 120 days had a typical discount of -8.5%. 
The data highlights the importance of setting an appropriate initial list price. Homes which are appropriately priced sell quickly and with a low level of discounting, whereas the longer you keep the property on the market it generally results in a larger discount in order to achieve the sale.
The improvement in both discounting and time on market is reflective of the broader housing market conditions.  Property transactions have increased measurably over the past year and home values have also risen.  These conditions are reflective of the increasing level of competition for those properties available for sale and have undoubtedly contributed to the improved discounting and time on market figures.
With mortgage rates likely to remain at their current low levels over the coming months and housing market activity likely to rebound from its usual December and January slumber, we would anticipate that discount levels will potentially improve further over the first half of 2014. The average time on market is also likely to remain at current low levels.
From a sellers perspective, setting an attractive initial list price will help to ensure that the selling process is a quick one and who knows, you may be one of the circa one third of the market that is selling their homes for more than their initial list price.
Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>.
 
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About a third of homes selling above listed price - vendor discounting to fall further

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A rebound in activity across Australia’s property market is having a flow on effect to other industry sectors; particularly dwelling approvals where, based on recently released Australian Bureau of Statistics (ABS) results, throughout 2013 there were 177,418 residential dwelling approvals.
Australia’s economic reliance is transitioning away from the resources sector to housing construction where according to the ABS building approvals data, there has been a sharp rebound in dwelling approvals through 2013. This is exactly what the RBA was hoping for.
Based on the ABS results, there were 177,418 residential dwelling approvals in 2013; the annual number of dwelling approvals was 15.7% higher over the year which represented the greatest annual increase since January 2011. The 177,418 dwelling approvals was also the greatest number of approvals since January 2011.
A valuable point of interest in the ABS data is that a vast majority of dwelling approvals continue to be granted to the private sector, with the public sector playing little part in the construction of new homes. Over the year, 98% of all dwelling approvals were to the private sector, which is encouraging.
The improvement across the housing sector is important for a number of reasons.
Housing construction is one of the key economic pillars that policy makers are looking towards to assist with the economic transition away from mega-infrastructure projects related to the resource sector which is winding down. Additionally, housing construction provides a significant multiplier effect on the Australian economy, providing more jobs and demand for building materials, home furnishings, appliances and white goods.
Points of interest - house and unit approvals:
• More approvals were granted for units at 77,909 approvals – an increase of 23.4% over the year
• 99,508 house approvals – an increase of 10.4% over the year which was the greatest annual increase since October 2010.
<img src="/images/stories/2014/02/06/kusher-feb-6-one3.gif" alt="kusher-feb-6-one3" height="221" width="470">
Looking specifically at the 77,909 unit approvals, this was the greatest number of annual unit approvals on record. As a result, units also accounted for a record high 43.9% of all dwelling approvals throughout 2013. Placing the heightened level of unit approvals into perspective, 10 years ago 32.6% of all approvals were for units whereas 20 years ago, they accounted for 30.0% of approvals.
Clearly, there is a significant push towards higher density development and this is particularly the case within capital cities.
While 43.9% of national dwelling approvals were for units in 2013, across the combined capital cities the figure was recorded at 52.3%.
<img src="/images/stories/2014/02/06/kusher-feb-6-two.gif" alt="kusher-feb-6-two" height="236" width="470">
Looking across the individual capital cities, all recorded more than half of all approvals for units over the year:
• Sydney (69.2%)
• Melbourne (53.7%)
• Brisbane (57.5%)
• Darwin (63.2%)
• Canberra (67.2%)
• Elsewhere 33.6% of Adelaide approvals were for units, 22.1% in Perth and 25.6% in Hobart.
<img src="/images/stories/2014/02/06/kusher-feb-6-three.gif" alt="kusher-feb-6-three" height="233" width="470">
The results also show that more than 50% of approvals have been for units in Sydney since 1992, in Melbourne since mid-2012 and in Brisbane since early 2003. Sydney has for a long time had a focus on higher levels of densification whereas it is a relatively new phenomenon across other capital cities.
The shift to more unit approvals over houses is indicative of ongoing densification of our capital cities as well as developers seeking to utilise land parcels to their highest and best use which is often multi-level development.
<img src="/images/stories/2014/02/06/kusher-feb-6-four.gif" alt="kusher-feb-6-four" height="236" width="470">
On a state by state basis, dwelling approval increases have been broad-based where approvals are -4.1% lower than a year ago in Victoria (after a strong run up in approvals during 2009/10) and -8.7% lower in Hobart. In all other states, approvals are higher than a year ago; the largest increases were located in: New South Wales (27.7%), Queensland (22.0%), South Australia (22.6%), Western Australia (32.3%), Northern Territory (47.5%) and Australian Capital Territory (41.1%).
Tasmania is the only state where home values continue to trend lower and Victorian dwelling approvals have been elevated over recent years while other states have recorded low levels of approval.
Overall the ABS results are encouraging and highlight that dwelling approvals are increasing. Based on the trend, it looks as if the housing pipeline is set to continue growing.
Ongoing densification across select capital cities is also reflective of changing lifestyle patterns and growing demand for inner city living. Based on this, we would expect that the proportion of unit approvals will continue to grow as the population increases and many property purchasers show a preference for living closer to the centre of cities at more affordable prices than those available for detached houses.
Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>.
 
 
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Australia transitioning from a reliance on the resource sector to housing construction

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Last year (according to the RP Data-Rismark Home Value Index), capital city home values rose by 9.8%, creating further affordability pressures for those segments of the market who are most price sensitive; the younger aged cohorts and first time buyers.  Our daily index data shows that home values have continued their strong pace of growth through the first month of 2014 with our combined capitals index likely to end the month slightly more than 1% higher.
Based on homes sold over the December quarter, the median price of a house across Australia’s capital cities is now $575,000; ranging from $775,000 in Sydney through to $350,000 in Hobart.  In the most expensive capital cities the challenge to buy a detached house within close proximity to where they work or socialise is simply out of reach for the vast majority of younger buyers.
<img class="aligncenter size-full wp-image-2844" alt="Chart 1" src="https://blog.rpdata.com/wp-content/uploads/2014/01/Chart-12.jpg" width="470" height="171" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Housing finance data indicates that as a proportion of the owner occupier market, first home buyers are currently at a record low level, accounting for just 12.3% of all owner occupier finance commitments. 
If first home buyers aren’t entering the market now, at a time of historically low mortgage rates, one might consider how and when they will ever enter the market.  In my opinion it is not always a case of not being able to afford to enter the market, it is often that the sacrifices a potential buyer would have to make in order to enter the market are too great.
There are some clear reasons why housing in Australia is expensive, including::
<img src="/images/stories/2014/02/04/number-1.jpg" width="20" height="30" alt="number-1" style="float: left;"> Australian’s have high levels of personal wealth and high incomes relative to most other countries.
 <img src="/images/stories/2014/02/04/number-2.jpg" width="26" height="30" alt="number-2" style="float: left;">Australia’s population is heavily centralised with around 55% of the national population residing in either Sydney, Melbourne, Brisbane and Perth.
 <img src="/images/stories/2014/02/04/number-3.jpg" width="22" height="30" alt="number-3" style="float: left;">Job opportunities and employment availability tend to be most abundant within capital cities.
<img src="/images/stories/2014/02/04/number-4.jpg" width="22" height="30" alt="number-4" style="float: left;"> The supply of new housing within the capital cities has consistently been insufficient to meet the level of demand over the past decade or so.
<img src="/images/stories/2014/02/04/number-5.jpg" width="22" height="30" alt="number-5" style="float: left;"> Population growth is strong with relatively high levels of overseas migration and natural increase creating additional demand for housing.
<img src="/images/stories/2014/02/04/number-6.jpg" width="22" height="30" alt="number-6" style="float: left;"> The cost of vacant land has been driven to unaffordable heights due to the slow release of new residential land supply and the restrictions of urban growth boundaries in most capital cities.
<img src="/images/stories/2014/02/04/number-7.jpg" width="22" height="30" alt="number-7" style="float: left;"> Negative gearing (which is available on all asset classes) encourages many to invest in residential property as a way of reducing their tax liability which creates additional housing demand.
Although these factors all contribute to a relatively high cost of housing, it does not mean that purchasing a first home is unachievable.  An upcoming analysis which will be released by RP Data this month finds that as at the end of 2013, across the capital cities, 28.4% of all homes had a current value of less than $400,000. Even in a market which is considered significantly unaffordable such as Sydney, 17.5% (almost one in five homes) have a value below $400,000.  Of course most of these properties are not located in the desirable areas of the city, but they are available.
Many potential first home buyers either still live with their parents or rent within areas close to where they work and socialise. For those living with their parents, it’s likely that the home they are currently residing in was not their parents first home. I’m sure if you asked many of those parent’s they would say that their first home was vastly inferior to their current home (ie they upgraded when they could afford to). For those renting in inner city areas, the reason why property prices and rents are so high in these areas is that demand is very strong while supply is quite limited which in-turn results in the high prices you see within these areas.
Given this, the prospective first home buyer is, in most instances, going to have to make a sacrifice in order to enter into home ownership.  As I see it, first home buyers need to make one of two major sacrifices; either move away from their local area to an area where home values are more affordable in order to enter the market or buy something which is at the lower end of the local market (which will often be a unit rather than a house). The strategy for someone buying their first home should rarely be to buy at the  suburbs median selling price; it should be to buy an entry level property.  Of course varying levels of deposit and income will dictate what the purchaser can reasonably afford to borrow and repay.  Over time, the first home buyer should see some capital growth and it would also be reasonable to expect that they should also experience an improvement in their employment conditions (more pay/promotion/new role) which would eventually help in assisting them to upgrade.
Looking at my first home buying experience, the above scenario parallels my own. I have to admit, the home was pretty horrible but it was in the inner city location I wanted.
My first purchase was a two bedroom, one bathroom unit in Fortitude Valley in Brisbane.  The location was great but the unit was not so great.  The complex was largely utilised for short term accommodation and although the unit had two bedrooms and one bathroom, outside of those three rooms it had one further room which functioned as a kitchenette, lounge and dining room.  I purchased the property for $248,000 in July 2005 and sold the property in April 2010 for $334,000 effectively five years later.  At the time of purchase, the median unit price within the suburb was $309,240 and by the time of sale the median unit price in the suburb was $400,000.
The unit was purchased at a price well below the suburb median and upon sale the price had increased by 35%.  In comparison the median sale price across Fortitude Valley had increased by a lower 29%.  At the time I was single so I also had a friend come and live with me which assisted in making the mortgage repayments.
By the time I sold the property I had purchased a subsequent property which was a house, once again it was purchased at a price below the suburb’s median.  I had managed to make a profit on the sale of my first home and purchased a more expensive property, I had also benefitted from an increase in salary over the time which made repayments easier.
In my experience the choice to purchase a first home is never an easy one.  It is often the case that what you think you should be able to get for your money and what you actually can get are very different.  But having an understanding of your budget and doing your research to get a realistic expectation of what properties and in what location you can afford to purchase takes some of the pain out of the house hunting process and purchasing.
Undoubtedly some people will not be able or willing to purchase but bemoaning the high cost of housing in the local area is unlikely to change the situation outside of wide-spread changes to government policy(ies).
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/" rel="nofollow" target="_blank">RP Data</a>.
 
 
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Seven reasons Australia's housing is expensive; is it out of reach for first home buyers? 

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In a turnaround for preferred property types in 2013, value growth for houses outperformed units whereas in 2012 it was the opposite. However, I question whether this will last during 2014, especially if buyers are locked out of markets due to affordability constraints.
Using the results in the December 2013 RP Data-Rismark Home Value Index, the combined capital city house values increased by 9.9% in 2013, compared to a 9.0% increase in unit values.
Although house values rose at a faster pace than units over the year, capital city houses and units recorded similar annual rates of growth over the past five years, at 4.8%, and 4.7% per annum respectively.
If we look at the median selling prices for houses and units across all capital cities over the final quarter of 2013, unit prices were around $95,000 lower than median house prices.
Across the individual capital cities, Adelaide had the smallest gap at $80,000 while in Sydney it was $218,000, Darwin $145,000, Melbourne $144,000 and Canberra $138,000; all recorded a differential which is greater than $100,000.
<img src="/images/stories/2014/01/29/kusher-jan-29-one.gif" width="470" height="233" alt="kusher-jan-29-one">
Based on these results, buyers may now opt to purchase units over houses, particularly in the more expensive cities where units are in abundance in the inner city areas and where the price difference between houses and units can be significantly greater than those across the broader capital city areas.
By percentages, the median unit prices across the combined capital cities are currently -16.5% lower than median house a price which is a record high differential. At the same time in 2012, the differential was - 14.3%.
<img src="/images/stories/2014/01/29/kusher-jan-29-two.gif" width="470" height="231" alt="kusher-jan-29-two">
Again, the widening gap between house and unit prices is likely to drive more purchasers to the unit market rather than the detached housing market.
At an individual capital city level, the price difference between houses and units has been increasing:
•Sydney - 28.1%
•Melbourne - 23.0%
•Brisbane - 18.5%
•Adelaide - 19.8%
•Perth - 18.3%
•Hobart - 27.1%
•Darwin - 24.5%
•Canberra -24.2%
<img src="/images/stories/2014/01/29/kusher-jan-29-three.gif" width="470" height="234" alt="kusher-jan-29-three">
For Sydney, Melbourne and Hobart, the differential in prices is at an all-time high. For Brisbane the price differential is the highest since early 2010, and in Adelaide it is at its largest level since the middle of 2008. The gap has closed slightly recently in Perth and Canberra, whilst in Darwin the differential is the greatest since late 2010.
If dwelling approvals data is anything to go by, it seems that in many of the capital cities new supply will be dominated by units rather than houses.
Over the 12 months to November 2013, approximately 50% of all approvals were for units in Melbourne and Brisbane while in Sydney, Darwin and Canberra, more than 60% of all dwelling approvals over the year were for units.
<img src="/images/stories/2014/01/29/kusher-jan-29-four.gif" width="470" height="237" alt="kusher-jan-29-four">
With strong value increases in some cities across 2013 coupled and with an increase in selling prices, we may see price sensitive buyers start to look at the unit market where there are many more options available.
As to who should be buying where, first home buyers should look at older units in inner city areas as these can offer more affordable entry points into the market while still being within popular locations. Units also offer a good housing alternative for those looking to downsize.
From an investor’s perspective, units typically enjoy stronger rental demand and superior gross rental yields to those awarded by houses.
All of these benefits are in most cases afforded at much lower prices than houses within the same local area.
Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>.
 
 
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Mind the price gap: Units currently better value for buyers than houses

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The Australian Bureau of Statistics (ABS) released the Consumer Price Index results for the December 2013 quarter earlier this week.  The December results provide a timely summary of consumer price rises up to the end of last year.
<img class="aligncenter size-full wp-image-2830" alt="Chart 1" src="https://blog.rpdata.com/wp-content/uploads/2014/01/Chart-11.jpg" width="470" height="173" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Headline inflation was recorded at 0.8% over the final quarter of the year and was 2.7% over the year.  Perhaps most interesting is the fact that the final two quarters saw inflation of 1.2% and 0.8%, an annualised rate of 4.0%.  The current annual inflation of 2.7% sits within the RBA’s target band of 2% to 3% however, the strong level of inflation over the past two quarters lessens the prospect of interest rate cuts for the time being.  The RBA prefer to look at underlying measures of inflation; the trimmed mean and weighted median each recorded quarterly rises of 0.9% in December.  Both measures have annual inflation recorded at 2.6% which is only slightly below the 2.7% headline figure.
From a residential property markets perspective the effects of inflation are also important to consider.
<img class="aligncenter size-full wp-image-2831" alt="Chart 2" src="https://blog.rpdata.com/wp-content/uploads/2014/01/Chart-21.jpg" width="470" height="172" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Based on the RP Data-Rismark Home Value Index, combined capital city home values increased by 9.8% in 2013 however, when you adjust for inflation the growth was a lower 6.9%.  Although home values rose over the year across all capital cities, when the impact of inflation is considered, home values actually fell in Hobart (-0.6%) and the rate of growth across all other cities was also lower.
Over time the impact of inflation on housing markets should also be considered.  The raw capital growth figures show that combined capital city home values at the end of 2013 were 3.5% higher than at their previous peak.  When these figures are adjusted for inflation, values are still -4.6% lower than their previous peak at the end of the September quarter in 2010.
<img class="aligncenter size-full wp-image-2832" alt="Chart 3" src="https://blog.rpdata.com/wp-content/uploads/2014/01/Chart-31.jpg" width="470" height="173" style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;">
Across each individual capital city market, inflation adjusted home values remain below their previous peak.  This includes Sydney and Perth where unadjusted figures show values are 10.9% and 3.6% higher than their previous peak respectively.  When adjusted for inflation, values across these two cities are currently -0.1% lower than their previous peak and Perth values are -8.9% lower.
If we look at the time of the previous market peak in inflation adjusted terms across each city, it goes some way to explaining why there has been such a pick-up in demand for housing and subsequently an increase in home values.  Sydney’s market peaked in the first quarter of 2004 and across other capital cities the market peaks were: Melbourne (Q3 2010), Brisbane (Q1 2008), Adelaide (Q2 2010), Perth (Q3 2007), Hobart (Q4 2007), Darwin (Q3 2010) and Canberra (Q2 2010).
With the relative costs of other goods rising at a faster pace than home values over recent years it is no surprise with mortgage rates at historic low levels that buyer demand and home values have now been rising.  From here, if inflation continues to climb that may result in the need to lift interest rates which would likely dampen investor activity and slow levels of capital growth.  The important thing to keep in mind however is that when you consider inflation, dwelling values remain lower than their previous peaks in every city.
Cameron Kusher is senior research analyst at <a href="https://www.myrp.com.au/" rel="nofollow" target="_blank">RP Data</a>.
 
 
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Inflation suprisingly strong while adjusted home values below previous peaks

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Last week’s I discussed what I believe are some of the<a target="_blank" href="https://www.propertyobserver.com.au/trends/what-lies-beneath-investor-driven-growth-cycle-heightens-underlying-risks/2013121066826"> potential pitfalls of such a high level of investment activity in the housing market</a>.  The housing finance data for October 2013 was released by the Australian Bureau of Statistics last week and it showed an ongoing escalation in investment activity which is a potentially worrying development and one that APRA and the RBA will have a close eye on.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="172" width="470" src="https://blog.rpdata.com/wp-content/uploads/2013/12/Chart-1.jpg" alt="Chart 1" class="aligncenter size-full wp-image-2776">
According to the October housing finance data, there was $10.3 billion worth of housing finance commitments for investment purposes over the month, up from $9.5 billion in September.  The value of investment loans is at a record high up from its previous high in September.  It is important to also keep in mind that housing finance data only looks at finance commitments to local authorised deposit-taking institutions (ADIs).  We hear a lot of talk about overseas investors and often that money is not sourced locally.  Given this, the true amount for all investors could be much higher.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="169" width="470" src="https://blog.rpdata.com/wp-content/uploads/2013/12/Chart-2.jpg" alt="Chart 2" class="aligncenter size-full wp-image-2777">
The $10.3 billion of commitments to investors is still lower than the $11.6 billion worth of commitments to owner occupiers for non-refinanced loans but is also much larger than the $4.6 billion in owner occupier refinance commitments.  As a proportion of the $26.5 billion in housing finance commitments over October, investment loans accounted for 38.9%.  Although this amount may not sound that substantial, it was the highest proportion of investment finance commitments since December 2003 (39.3%) and not all that far from the record high proportion of 41.2% in October 2003.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="172" width="470" src="https://blog.rpdata.com/wp-content/uploads/2013/12/Chart-3.jpg" alt="Chart 3" class="aligncenter size-full wp-image-2778">
If we look back to the peak in investor activity in October 2003, the annual rate of capital growth across the combined capital cities was recorded at 17.7% at that time.  From there on, the annual rate of capital growth started to decelerate.  This may suggest that as investment activity peaks (whenever that may be) it could be a precursor to a slowdown in overall capital growth conditions.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="170" width="470" src="https://blog.rpdata.com/wp-content/uploads/2013/12/Chart-41.jpg" alt="Chart 4" class="aligncenter size-full wp-image-2779">
It looks as if much of the investor activity currently taking place is pure speculation on capital growth.  Home values across the combined capital cities are 8.0% higher over the year which has significantly outperformed the 2.9% growth in rental rates. As the above chart shows, both the annual rate of rental growth and rental yields are falling which will result in a lower rental return.  This is highlighted by the fact that we have seen capital city gross rental yields fall from 4.3% a year ago to 4.1% currently, which is not particularly attractive from an investment return perspective without the capital growth.
Of course this heightened level of investment activity with little focus on rental returns is likely to result in an even greater number of negatively geared owners of investment properties.  The latest data from the Australian Tax Office (ATO) based on the 2010-11 financial year showed that 1,811,175 individuals claimed rental income and two thirds of which claimed rental losses of $13.285 billion.  With investment activity currently so high and investors seemingly focused on capital growth it seems inevitable that the number and value of losses on residential investment properties is set to increase.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="170" width="470" src="https://blog.rpdata.com/wp-content/uploads/2013/12/Chart-5.jpg" alt="Chart 5" class="aligncenter size-full wp-image-2780">
This heightened level of investment activity is also coming at the expense of first home buyers.  Based on the number of owner occupier finance commitments, first home buyers accounted for just 12.6% of all owner occupier finance commitments in October, slightly higher than the record low of 12.5% the previous month.  As the above chart shows on both a volume and percentage basis, first home buyer participation in the market is at near record low levels.
<img style="margin: 0px auto 15px; padding: 3px; border: 1px solid #e6e6e6; outline-width: 0px; background-color: rgba(255, 255, 255, 0.701961); max-width: 100%; text-align: center; height: auto; display: block; vertical-align: bottom;" height="171" width="470" src="https://blog.rpdata.com/wp-content/uploads/2013/12/Chart-6.jpg" alt="Chart 6" class="aligncenter size-full wp-image-2781">
We know that the trend has been towards a greater proportion of the population renting however, there must be a sense that the high level of investment activity is to some degree locking potential first home buyers out of the market.  The latest housing finance data shows that first home buyers and owner occupiers who are non-first time buyers have both recently started to increase their borrowing amounts.  Obviously value escalation is partly responsible however, values were rising in 2009 and 2010 without any significant lift in borrowings.  The data potentially indicates that investors are driving values higher and both first home buyers and non-first home buyers have a fear of missing out and are increasing their borrowings in order to enter the market.
If this trend continues it could be quite worrisome as it may lead to both increasing levels of household leverage along with increasing demand for loans with a higher loan to value ratios (LVR) meaning that buyers are using smaller deposits in order to enter the market. The heightened level of investment activity and the potential long-term repercussions for the housing market must surely now call for close scrutiny by both the RBA and APRA.
 
<hr>
 Cameron Kusher is senior research analyst at <a target="_blank" rel="nofollow" href="https://www.myrp.com.au/">RP Data</a>.
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Stats show investor level in the market near record, but true number could be much higher

Melbourne developer Spacious Group has completed Voyage Altona, one of the closest new apartment developments to Altona Beach.

Off the plan purchasers have started moving into the 49-apartment project on Pier Street, with the remaining move-in-ready one-, two- and three-bedroom apartments starting from just over $500,000.

Display apartments have now been fitted out, allowing prospective buyers to inspect the completed residences by appointment.

[smartcode_project:default project_id=112195 project_image_fid=372638]

The completed apartments feature open-plan living and dining areas which extend onto private balconies and terraces, while full-height glazing maximises natural light throughout the interiors.&nbsp;

Hybrid timber-look flooring, stone benchtops, Miele appliances, porcelain-tiled bathrooms and generous storage feature throughout the building which also features landscaped communal areas, expansive shared terraces, lift access and secure on-grade parking.

Drawing inspiration from its bayside setting, Voyage adopts a restrained palette of warm neutral tones and textured finishes. Many of the apartments take advantage of views across Port Phillip Bay, while the indoor-outdoor living spaces have been designed to make the most of the coastal outlook.

[smartcode_project:default project_id=112195 project_image_fid=3286]

Voyage was developed to address what Spacious Group identified as an undersupply of higher-quality apartment product in Altona, with a focus on owner-occupiers looking to remain within the bayside community.

"Voyage responds to very strong local buyer demand for quality, owner-occupier-focused product," says Barry Plant Projects Director Jarrod Farey, who has handled sales since the project's launch.

"The project delivers an elevated lifestyle proposition, with its design and quality of finish far exceeding anything previously produced in the area, as well as its proximity to Pier Street Village and the beach."

The majority of purchasers have been local downsizers and owner-occupiers looking to stay within the Altona community but who previously had limited opportunities to buy a brand-new apartment.

[smartcode_project_cta:default project_id=112195]

Joel Robinson

Spacious Group completes Voyage Altona in Altona's beachside precinct

Homecorp has secured approval for a $360 million apartment development at Budds Beach, paving the way for one of the Gold Coast's most amenity-rich residential projects to launch later this year.

Gold Coast City Council has approved Lýon Residences, a 32-level tower that will deliver 178 two and three-bedroom apartments across a prominent corner site at 8-10 Acacia Avenue and 25-27 Oak Avenue.

The approval comes as developers continue to invest in premium lifestyle-driven apartment projects on the Gold Coast, where owner occupiers are increasingly prioritising amenity as much as apartment size and location.

<a href="https://www.apartments.com.au/new-apartments/l-on-residences-25-27-oak-avenue-surfers-paradise-qld-4217">Lýon Residences</a> has been designed around a resort-style wellness offering, headlined by a Moroccan-inspired spa precinct featuring treatment rooms, a Nordic sauna and steam room, hot and cold plunge pools, a soaking pool and a residents-only juice bar.

The rooftop will include a heated infinity pool and spa, residents' lounge with private kitchen and bar, gymnasium, yoga and Pilates studio, outdoor entertaining areas and barbecue facilities overlooking the Surfers Paradise skyline.

<img alt="Lyon" data-entity-type="file" data-entity-uuid="2d3e29af-8793-486e-a684-52cef862241f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-15%20at%204.32.26%E2%80%AFPM.png?VersionId=ayG2zpLf3SS6Zy8XmKDcQods4kVWb0gm" />

Homecorp Founder and CEO Ron Bakir said Budds Beach provided the ideal location for the company's latest luxury apartment project.

"Budds Beach represents one of the most unique and sought-after pockets of the Gold Coast, and Lýon Residences has been designed to reflect that sense of rarity and refinement," Bakir said.

The project arrives as wellness continues to become a defining feature of new residential developments both in Australia and internationally.

The latest Global Wellness Institute figures show wellness real estate remains the fastest-growing segment of the global wellness economy and is forecast to exceed $1.8 trillion by 2030. Australia continues to rank among the world's 15 largest wellness real estate markets, with developers increasingly integrating health, recreation and community facilities into apartment projects.

Queensland is also experiencing strong population growth, with the Gold Coast continuing to outperform many other Australian cities as demand for new housing remains elevated ahead of the 2032 Olympic and Paralympic Games.

Bakir said the project had been designed to respond to that shift in buyer expectations.

"Strong population growth and sustained demand across the Gold Coast continue to highlight the need for well-designed new housing supply. Lýon Residences responds directly to this demand while setting a new benchmark for residential living," he said.

Each apartment has been designed to maximise views across the coastline, the Nerang River and the Gold Coast hinterland.

Located just minutes from Surfers Paradise beach and the Broadwater, the development also offers easy access to the light rail network, Broadbeach and Burleigh Heads.

Early site works are underway, with construction expected to commence later this year.

Homecorp approved for Budds Beach apartment tower, Lýon Residences

New apartment developments with uninterrupted, north-facing views over Perth's Swan River are exceptionally rare.

Recognising just how limited those opportunities are, <a href="https://www.apartments.com.au/developers/edge-visionary-living">Edge Visionary Living</a>, one of Perth's most respected builder-developers, targeted <a href="https://www.apartments.com.au/developments/applecross-wa-6153">Applecross</a>, assembling an unrepeatable 6,342 sqm riverfront site on the corner of Moreau Mews and Canning Beach Road to create one of Perth's only new north-facing apartment developments directly overlooking the Swan River.

Today, <a href="https://www.apartments.com.au/buildings/riviere-residences-applecross-59-canning-beach-road-applecross-wa-6153">Rivière Residences</a> offers buyers a unique opportunity to choose between completed residences ready to move into now and off-the-plan homes in the final stage, Rivière West.

[smartcode_project:default project_id=28384 project_image_fid=3823]

Across the completed East and Central buildings, residents are already enjoying the development's luxury amenity, while two of the precinct's hospitality venues are now open.

The completed component of the development gives buyers the advantage of experiencing the finished product firsthand, including its uninterrupted river views, while still having the opportunity to secure a residence in the final stage.

"People are wowed by the view and the quality of the apartments,"&nbsp;Edge Visionary Living Sales Executive, Holly McSweeney, says.

"They're looking for the convenience of lock-and-leave living, but they're not looking to downsize on quality."

[smartcode_project:default project_id=28384 project_image_fid=3826]

The rarity of the development hasn't been lost on prospective buyers, McSweeney says.

For McSweeney, it all comes back to a location that is becoming increasingly difficult to replicate.

"Location, location, location," she says. "We are nestled right on the front of the Swan River. You can never get built out, so wherever you are in Rivière Residences, you've got views of the river forever."

The unique waterfront position has resonated particularly strongly with local downsizers. McSweeney says many buyers are long-time Applecross residents looking to transition from large family homes into a luxury apartment without sacrificing space, quality or the lifestyle they've enjoyed for decades.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/N_FowNW0wu8?si=vb25XFq1wZ-iufAW" title="YouTube video player" width="560"></iframe>

A major focus for Edge in recent years has been resident amenity. Across its apartment portfolio, from beachfront developments in Scarborough to luxury towers in South Perth, the developer has increasingly invested in the spaces beyond the apartment itself.

The strategy has largely been shaped by downsizer demand. Many buyers are moving from large family homes with swimming pools and established gardens. While they're looking to leave the maintenance behind, they don't want to compromise on lifestyle.

At Rivière, <a href="https://www.apartments.com.au/architects/hillam-architects">Hillam Architects</a> designed the resident facilities as an extension of each apartment. A 25-metre heated swimming pool takes advantage of the north-facing river outlook, complemented by a large gym, sauna and steam rooms, private dining spaces, residents' lounges, a cinema, games room, and dedicated wine and whisky rooms.

[smartcode_project:default project_id=28384 project_image_fid=372542]

The waterfront location has also proved to be a major drawcard. Residents are within walking distance of the Raffles Hotel, South of Perth Yacht Club, the Heathcote Cultural Precinct and the cafés, restaurants and boutiques along Ardross Street.

Beyond the location and amenity, McSweeney says many buyers take confidence from Edge's fully integrated development model.

Having delivered apartments across Perth for decades, Edge now designs, develops and constructs its projects in-house, giving the company greater control over quality, delivery and the finished product.

"What I love is when people walk through their apartment for the first time and say, 'This is better than what we imagined,'" McSweeney says. "We hear that all the time."

Completed apartments in the East and Central buildings are now available to inspect by appointment, while Rivière West, the final stage of the precinct, is expected to be completed in the first quarter of 2027.

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North-facing Swan River views drive demand at Rivière Residences in Applecross

Nearly 60 per cent of apartments at McNab Group's $220 million The Tannery development in Brisbane's West End have sold ahead of the project's public launch, including a suburb-record $2.57 million sale for a two-bedroom apartment.

The early sales campaign has secured buyers for 50 of the project's 87 apartments, highlighting continued demand for larger owner-occupier apartments that combine generous floorplans with premium lifestyle amenities in one of Brisbane's most tightly held inner-city suburbs.

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McNab Group Executive Chairman Michael McNab said selling more than half the project before launch reflected changing buyer expectations.

"Selling more than half the project before public sales open tells us buyers are actively seeking apartments that offer something genuinely different," McNab said.

"Today's buyers are looking beyond four walls. They want homes that genuinely enhance the way they live, with spaces that support health, connection and everyday wellbeing."

[smartcode_project:default project_id=143337 project_image_fid=374767]

A key point of difference for the project is the adaptive reuse of the heritage-listed Dixon's Tannery building, which will become The Retreat, a residents-only wellness precinct rather than being redeveloped into additional apartments.

The Retreat will feature a sauna and steam room, hot and cold plunge pools, a commercial-grade gym, Pilates studio, cinema, library, co-working spaces and private dining room. Rooftop amenities will include a swimming pool, landscaped gardens, outdoor entertaining areas and dog-friendly spaces.

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Designed by Cottee Parker Architects with interiors by Tom Mark Henry and landscape architecture by Aspect Studios, The Tannery comprises 87 two, three and four-bedroom apartments across 11 levels overlooking the Brisbane River.

Cottee Parker principal Dee Passenger said preserving the original tannery building had been central to the project's design.

"The easy option would have been to maximise the site's development potential with additional apartments. Instead, McNab has chosen to preserve the original tannery as a shared wellness retreat, ensuring this important piece of Brisbane's history remains at the heart of the community."

Passenger said sustainability also played a key role in the design, with materials from the original industrial site salvaged and repurposed throughout the development.

[smartcode_project:default project_id=143337 project_image_fid=374761]

Motiv CEO Carly Cottam said buyers had responded strongly to the combination of larger apartments, wellness facilities and the West End lifestyle.

"We are seeing more buyers looking for homes in the sky that provide the space and functionality of a traditional home, while benefiting from the convenience and lifestyle that apartment living brings," Cottam said.

She said purchasers included both owner occupiers and investors, with demand coming from local buyers as well as interstate purchasers.

Coinciding with the public launch, McNab also announced a partnership with Queensland Ballet, whose neighbouring Thomas Dixon Centre shares historical ties with the original Dixon family.

Located on a 4,465 sqm site at 439 Montague Road, The Tannery overlooks the Brisbane River and is around 10 minutes from the CBD.

Construction is underway, with completion expected in the second half of 2027.

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More than half of residences sold before public sales as McNab announces significant partnership with Queensland Ballet

McNab's The Tannery nears 60 per cent sold before public release, sets two-bedroom West End record

Iwan Sunito's vision for a landmark mixed-use precinct in Sydney's Inner West has taken a major step forward, with approval granted for the $1.9 billion Five Dock development first unveiled earlier this year.

The approved scheme by <a href="https://www.apartments.com.au/developers/one-global-capital">One Global Capital</a> will deliver an 80,500 sqm mixed-use precinct comprising 840 apartments, integrated hotel accommodation, commercial and retail space, alongside publicly accessible open space designed to create a new destination for the growing suburb.

"This is a significant milestone for One Global Capital and for the future of housing delivery in Sydney," Sunito said.

"The Housing Delivery Authority was established to identify major housing projects capable of delivering meaningful supply more efficiently, and we are delighted that Spencer Street has been recognised as one of those projects.”

He said the declaration reflected the rapid progress achieved since acquiring control of the site.

"In less than seven months we have progressed from taking control of the site to securing entry into one of the NSW Government's most important planning pathways. It reflects the experience of our team, the strength of our consultant group led by Urbis, and our long-term commitment to delivering transformational projects that contribute to Sydney's future."

When the project was revealed earlier this year, Sunito described the opportunity as one of the strongest development sites he had worked on.

"I probably hadn't appreciated the uniqueness of the site until more recently when putting together the concept plans," Sunito said.

"The proximity to the water, and the golf course opposite, is unlike any other part of Parramatta Road. We have a unique position and view corridors over the water that makes this one of the best sites I've worked on."

The development has evolved since its initial announcement, with the approved plans increasing the residential component from the originally proposed 750 apartments to 840 homes while retaining the project's focus on creating an integrated neighbourhood rather than a standalone residential development.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/a-city-within-a-city-iwan-sunito-flags-1-5-billion-mixed-use-precinct-in-five-dock">"A city within a city": Iwan Sunito flags $1.5 billion mixed-use precinct in Five Dock</a>

The precinct will combine apartments with hotel accommodation, commercial workplaces, retail offerings and public spaces, creating a mixed-use environment intended to serve both residents and the broader Five Dock community. The proposal also continues the collaboration between One Global Capital and internationally recognised architect <a href="https://www.apartments.com.au/architects/koichi-takada-architects">Koichi Takada</a>, whose previous work with Sunito includes Infinity, Arc and Skye North Sydney.

Takada previously said the design was driven by a philosophy of integrating nature into the built environment.

"The concept for this development is born from our design approach to naturalising architecture," Takada said.

"The public realm benefits from biophilic design that integrates generous landscaping, and the development is optimised for natural daylight, airflow and water views to foster wellbeing, sustainability and spaces that foster community interaction."

Sunito has consistently described the project as a "city within a city", with a strong emphasis on creating a destination that extends beyond housing.

"We want to create a development that's not only to be seen, but to be experienced by the whole local community," he said.

The approval comes as Five Dock continues its transformation ahead of the opening of the Sydney Metro West line, with the new Five Dock station set to significantly improve connections between the Inner West, Parramatta and the Sydney CBD.&nbsp;

The precinct will also benefit from its proximity to the Parramatta Road corridor, nearby waterfront parklands and established retail and dining offerings that have made Five Dock one of Sydney's most tightly held Inner West suburbs.

Cameron Kusher

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